Why Every Home Buyer Should Use a Buyer's Agent [Back to Top] "How Can a Buyer's Agent Help Me?" Any agent usually owes these duties to their home buyer:  • Loyalty  • Diligence  • Confidentiality  • Obedience  • Full Disclosure  • Accounting  • Care These responsibilities are defined by state laws, the Realtor Code of Ethics, general principles of agency and court decisions. That's the legal definition. But what does a Buyer's Agent actually do for the home buyer? Like other agents, a Buyer's Agent will show you available homes, point out the property's features, provide financing information and submit the offer to purchase. But that's not all. As your representative, a Buyer's Agent will share valuable and essential information with you if the agent knows it, such as:  • Whether the seller would accept a lower price  • The seller's reason for selling and timetable  • How long the home has been on the market  • Previous offers and counteroffers for the property  • Strengths and weaknesses of the property Most important for many buyers, you can ask a Buyer's Agent for advice and assistance in setting your offering price and structuring the other terms of your offer. What's more, you'll have peace of mind knowing an advocate is working on your behalf to help you buy at the best possible terms. "Who Needs a Buyer's Agent?" If you want to make sure you buy smart, you need a Buyer's Agent. If you're a first-time buyer, if you're relocating or unfamiliar with the local real estate market, if you're buying for investment and want negotiating help, or if you need to purchase anonymously, you'll be best served by a Buyer's Agent who puts your interests first. Also, if the real estate professional helping you find a home is a relative, close friend, a business associate or you previously were the agent's home-selling client, chances are you'd expect the agent to represent your interests and should establish a Buyer Agency relationship. Or, if you just want to get the best value in a property and an agent, you owe it to yourself to be the most knowledgeable buyer you can be. "Can a Seller's Agent or Subagent Help Me Buy?" Without a Buyer's Agent, you're really on your own. Keep in mind, the Seller's Agent or subagent is actually working for the seller and is the seller's legal representative. Yes, a Seller's Agent or subagent can offer buyers some services, including a diligent search to find the right home, an explanation of available financing, calculation of monthly payments, estimation of settlement costs, presentation of your offer to buy. What a Seller's Agent cannot do is disclose information not in the best interest of the seller such as an opinion of the home's real value or what price and terms the seller would accept. By law, the Seller's Agent or subagent must negotiate on behalf of the seller and may not withhold from the seller information that could strengthen their bargaining position. That means you, as a buyer, should be careful not to disclose to the Seller's Agent or subagent any financial or personal information that could be used against you. "What Will a Buyer's Agent Cost Me?" Not a penny. The seller pays your fee through the commission their agent shares with your agent. Perhaps the right question is, "What will it cost me if I don't use a Buyer's Agent?" Purchasing a home without representation is possibly the biggest financial mistake you can make. A Buyer's Agent can guide you each step of the way to prevent costly errors. Failure to find out about defects in the property or the actual value of the property can, of course, be an expensive mistake. And failure to negotiate a contract that works for you can cost you plenty. With a Buyer's Agent, you can ask for and receive advice and assistance in selecting the best property and determining an offering price. "What Is a Transaction Broker?" If your Buyer's Agent locates a home you wish to buy from his own agency ("in house"), the Seller's Agent and your Buyer's Agent must both revert to either Dual Agents or Transaction Brokers, in order to assure that buyer and seller are treated fairly and equally. Both agents are required to provide complete disclosure, due diligence, and the care and accountability that they would always provide. But neither agent may disclose personal information (like how much a buyer would be willing to pay or how low a seller would be willing to sell) to the other. The Bottom Line. If you want an agent to fully represent your best interests, if you want help evaluating a property, if you want someone to negotiate to get you the best price and the best terms, if you want to purchase a home in what's becoming the most popular way to buy, you'll want to enlist the aid of a Buyer's Agent.

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Buyer's Agent [Back to Top] Definition: A Broker engaged through a written agreement by the Buyer/Tenant to act as Buyer's Agent or Tenant's Agent. Duties of the Agent:  •  To perform the terms of the written agreement.  •  To exercise reasonable skill and care for the Buyer/Tenant.  •  To promote the interests of Buyer/Tenant with utmost loyalty, good faith and fidelity.  •  To seek a price and terms acceptable to Buyer/Tenant.  •  To present all offers to and from Buyer/Tenant in a timely manner.  •  To disclose to Buyer/Tenant adverse material facts actually known by Broker.  •  To advise Buyer/Tenant as to material benefits or risks actually known by Broker.  •  To advise Buyer/Tenant to seek legal and other expert advice.  •  To account in a timely manner for all monies and properties received.  •  To inform Buyer/Tenant of his/her vicarious liability for their agent's acts when the agent is acting within the scope of the agency relationship.  •  To comply with all local, state and federal laws.  •  To disclose the following only with informed consent of the Buyer/Tenant.  •  That the Buyer/Tenant is willing to pay more than the purchase/lease price.  •  What the motivations are of Buyer/Tenant.  •  What financing terms the Buyer/Tenant would agree to.  •  Any material information about the Buyer/Tenant unless required by law.  •  Facts or suspicions which may psychologically impact the purchase. Termination of agency will be the earlier of the following:  •  The date of expiration agreed to by the parties.  •  Termination by the parties.  •  One year after the engagement. Responsibilities following contract termination or performance:  •  Accountability for monies and properties  •  Confidentiality of information received during agreement unless: a. Required by law. b. Released in writing by engaging party. c. Information is made public by source other than Broker. Compensation:  •  Payment of compensation shall not be construed to establish agency.  •  Compensation may be paid by Buyer/Tenant or Seller/Landlord or third party.  •  The identity of source of compensation shall be disclosed to all parties.  •  Compensation by more than one party is permitted with the written consent of the parties.

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Seller's (Listing) Agent [Back to Top] Definition: A Broker engaged through a written agreement by the Seller/Landlord to act as a Seller's Agent or Landlord's Agent. Duties of the Agent:  •  To perform the terms of the written agreement.  •  To exercise reasonable skill and care for the Seller/Landlord.  •  To promote the interest of the Seller/Landlord with utmost loyalty, good faith and fidelity.  •  To seek price and terms acceptable to Seller/Landlord.  •  To present all offers to Seller/Landlord in a timely manner.  •  To disclose material facts to Seller/Landlord actually known to Broker.  •  To counsel Seller/Landlord as to material benefits or risks.  •  To advise Seller/Landlord to seek legal and other expert advice.  •  To account in a timely manner for all monies and properties received.  •  To inform Seller/Landlord of his/her vicarious liability for acts of their agent when agent is acting within the scope of the agency relationship.  •  To comply with applicable local, state and federal laws.  •  To disclose the following only with informed consent of the Seller/Landlord.  •  That the Seller/Landlord is willing to accept less than the asking price.  •  What the motivations are of the Seller/Landlord.  •  What financing terms the Seller/Landlord would accept other than those offered.  •  Any material information about Seller/Landlord unless required by law.  •  Facts or suspicions which may psychologically impact the sale. Termination of agency will be the earlier of the following:  •  The date of expiration agreed to by the parties.  •  Termination by the parties.  •  One year after the engagement. Responsibilities following contract termination or performance:  •  Accountability for monies and properties  •  Confidentiality of information received during agreement unless: a. Required by law. b. Released in writing by engaging party. c. Information is made public by source other than Broker. Compensation:  •  Payment of compensation shall not be construed to establish agency.  •  Compensation may be paid by Buyer/Tenant or Seller/Landlord or third party.  •  The identity of source of compensation shall be disclosed to all parties.  •  Compensation may be paid by more than one party with the written consent of the parties.

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Dual Agent [Back to Top] Definition: A Broker who has been engaged through a written agreement to act as Agent of Buyer/Tenant and Seller/Landlord. Duties of the Agent:  •  Obtain written And Informed consent of all parties to act as Dual Agent.  •  To inform Buyer/Tenant and Seller/Landlord that each may be vicariously liable for the acts of the dual agent when agents are acting within the scope of the dual agency relationship.  •  To disclose material facts gained from the other party if such information is relevant to the transaction.  •  To disclose any information to one party gained from the other party when information is relevant to the transaction or party.  •  To disclose the following only with written consent of the party. a. That Buyer/Tenant is willing to pay more than purchase price. b. That Seller/Landlord is willing to accept less than asking price. c. What motivating factors are for either party. d. What Seller/Landlord or Buyer/Tenant will accept terms other than those offered. e. Facts or suspicions which may psychologically impact the sale or purchase. Shall Not Disclose:  •  Information made confidential by the parties. Termination of agency will be the earlier of the following:  •  The date of expiration agreed to by the parties.  •  Termination by the parties.  •  One year after the engagement. Responsibilities following contract termination or performance:  •  Accountability for monies and properties  •  Confidentiality of information received during agreement unless: a. Required by law. b. Released in writing by engaging party. c. Information is made public by source other than Broker. Compensation:  •  Payment of compensation shall not be construed to establish agency.  •  Compensation may be paid by Buyer/Tenant or Seller/Landlord or third party.  •  The identity of source of compensation shall be disclosed to all parties.  •  Compensation by more than one party is permitted with the written consent of the parties.

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Glossary of Agency Terms [Back to Top] Agency Relationship: agreement between an agent and a client in which the agent acts in the client's best interests in a real estate transaction; also, "Brokerage Relationship." Buyer's Agent: acts exclusively on behalf of the buyer; also, "Buyer's Broker." Listing Agent: person acting on behalf of the seller; the agent who "lists" the home for sale; also "Seller's Agent." Client: the buyer represented by a Buyer's Agent or the seller represented by a Seller's Agent; also, the "Principal." Customer: a buyer who works with a Seller's Agent is considered a "customer" rather than a "client" of the Seller's Agent because they have not entered into an agency relationship. Buyer has no representation. Disclosed Dual Agency: Occurs when one brokerage company represents both the buyer and the seller. In some states, certain modifications may be allowed by law. Subagent: agent often from another company other than the listing company working with the home buyer but who legally represents the seller.

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